Close

Choose a country

United KingdomEnglish
South AfricaEnglish
IndiaEnglish
InternationalEnglish

The Late Payments Epidemic

Blog
13th January 2017

 

late payments, smes

Outstanding invoices are a nightmare for any company. Business leaders already have to manage clients, ensure delivery and make consistent sales – adding late payments into the equation increases the burden on both your team and your business.

Many companies collapse each year under the strain of trying to manage their cashflow. They need to pay for services on time, but their clients happily let invoices sit in their accounts department for months before releasing payments. Recent research by the Zurich SME Risk Index suggests that 53% of small to medium-sized enterprises (SMEs) in the UK are currently owed money as a result of late payments. This adds up to about £255bn that should be with smaller companies, but is instead just sitting in the bank accounts of their clients. Zurich estimates that around 20% of companies are owed over £20,000, and around 8% are owed over £100,000.

Late Payments Worldwide

Payment behaviour is different across the world, and often dependent on the prevailing interest rates in that region. For example, in Japan most companies pay earlier than required. With rates at zero to negative, there is no incentive to keep cash in the bank. Although Brazil, in contrast, has relatively high interest rates but a culture of naming payment dates on invoices so the client and supplier both have an expectation of the exact payment date – rather than the more vague 30-90 days we are used to in the UK.

The UK government has attempted to address the culture of late payments with several measures. They have forced large companies to openly publish their payment practices and how they are performing on average against their planned payment schedules. In addition, a small business commissioner position is in the process of being created. This commissioner will have the power to chase offenders directly and to try influencing further policy changes.

However, back in the real world it can be difficult to manage late payments and despite the efforts of the government to improve the general business environment in the UK, if you have open invoices now then you need to get paid. There are numerous professional bodies out there that can help – until vast change takes place in global payment culture, they are the best hope for many businesses.

What are your experiences with late payments? Leave a comment below and let me know, or get in touch on LinkedIn.


Leave a Reply

Your email address will not be published.Required fields are marked *


David Turner
Article by: David Turner

News & Insights

Recommended for you
Solution Designer
Service Provider
Technology Enabler
Blog
Inside Sales – This new generation of B2B salespeople that is changing everything! at last!

The B2B sale has adopted a new model, of American origin. More efficient, it is based on Inside Sellers. Their profile and working methods are presented by Etienne Turion, Webhelp Enterprise CEO. What are the new challenges in the sale of B2B products and services? First of all, a first observation: "cold" contact is largely over in B2B. Call campaigns are no longer launched on...

Whitepaper
AI and Automation: Improving the Customer Experience

This paper has been borne of conversations with experts within Webhelp and beyond and is also the result of a YouGov study of over 2,000 adults in the UK. In this paper we hope to dispel some myths around automation and Artificial Intelligence (AI) and also to outline the most effective ways that...

News
Webhelp Employees Saddle Up For Charity In Virtual Cycle To India

Teams at Webhelp, one of the country’s leading business process outsourcers (BPO), have raised £2,119.96 for ultra-athlete and cystic fibrosis warrior Josh Llewellyn Jones through a virtual cycle from Larbert to Guragon in India. On January 31st 2019 staff from across all the Webhelp UK,...

News
Webhelp and SKY make it a hat trick of awards

London, UK, 30/11/2018 Global customer experience expert, Webhelp, and leading telecommunications provider, Sky, were celebrating again after taking home the award for Best Outsourced Contact Centre at the European Contact Centre and Customer Service Awards, which took place in London on 27th...

Case Studies
Webhelp People Analytics

...

×

Webhelp Cookies Preference Centre

Strictly Necessary Cookies
The website requires the use of cookies for essential functional requirements and these are outlined in the cookies policy.

Enhanced Functional Cookies
Some features of this website use services provided by third parties websites. These features use cookies to implement their services on this website and may collect data about your visit to help them optimize their functionality. The Webhelp cookies policy outlines the cookies used by these services.

We have links to social networking such as Twitter, Facebook and LinkedIn.
These websites are third party sites. We do not place cookies on their behalf, and do not have control over the way they collect or use your data.
We encourage you to read more about their policies:
Twitter
LinkedIn
Facebook